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Oil Money Blown on Nonexistent Projects; As KITE Calls for ABFA Law Amendment

KITE, an energy policy think tank and pressure group has made damning revelation of how Ghana’s Oil money has been used over the period of 2011 through to 2016, revealing that monies from oil sale were in certain cases spent on projects which are non-existent and projects which are of no need to related communities.

It was revealed that, some projects as reported by the MMDAs as having been executed with oil monies were nonexistent, as visit to the various project sites showed.

One of the several instances revealed a six unit classroom block which was reported to have been funded by oil money in Duu, of the East Mamprusi district was not found upon visit, and members of the community confirmed no such project in the community.

In another case, a dam which was supposed to have been funded by oil money was not found.

Presenting its Report on the Evaluation of key provisions in the Petroleum Revenue Management Act (PRMA), in terms of the usage of monies from oil sale, Ismael Edjekumhene, the Executive Director of KITE revealed at a Stakeholders Workshop in Accra on April 19, 2018, that even though the Petroleum Revenue Management Act stipulates that government should invest oil monies in four (4) priority areas, government rather spent oil monies in ten (10) sectors during the period under review, which is contrary to the law.

It was revealed that the government within the period also breached the provision of the law which states that “future petroleum revenue allocations should be guided by strategic medium-term plans that align with national priorities shaped through public consensus” by spending on projects which either did not reflect the actual needs of the communities or were simply different projects which were entirely different from the ones reported by the respective MMDAs.

He said, over 60% of projects undertaken were not priority projects for the respective communities whilst the very important priority ones were ignored.

He further revealed that, 44% of the oil money had gone into roads and other infrastructural projects, Agriculture 11%, expenditure on the amortization of loans amounted to 26%, Ghana Infrastructural Fund 8%, PIAC less than 1% at the time and capacity building over three hundred million Ghana cedis.

He also disclosed that huge monies were spent on capacity building, and in this is about 60% of monies spent on capacity building going into education and such monies were in some cases used to print registers and attendant sheets for capacity building, school fees subsidies, chunk also going into scholarships and capitation grants, supply of free school uniforms and even supply of stationery, whilst these are supposed to be funded by the GETFund, which has an assured source of money supply.

This, according to him, could be a breeding ground for people to misuse the GETFund monies.

There were instances of overpayment of contract amounts.

He said the government stayed within the law to allocate oil money to four (4) priority sectors in 2011, but veered off to 12 sectors in 2012, 8 in 2013, 6 in 2014, 8 in 2015 and 6 in 2016, in breach of the spirit of the law.

He also indicated that the law seeks to ensure an even distribution of oil money to ensure even level of development across the nation.

In effect, the poorest regions should have received more of the allocation, but the reverse is the situation here.

The Western region received the highest allocation followed by the Greater Accra region, with Central region receiving the least of oil monies followed by the three northern regions.

Franklin Cudjoe of IMANI Ghana, feared that there could be time the citizens would get angry at the level of misappropriation and misapplication of their hard earned taxes and the result may not be as we want.

He called on the government and Parliament to be proactive in taking action on such issues, especially on the periodic reports of the Public Interest Accountability Committee (PIAC).

He also called for an immediate forensic audit into these findings and many more by other institutions, also calling for an amendment of the current law to reflect current issues.

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